The Securities and Exchange Board of India (SEBI) has come out with guidelines for calculating the “unaffected price” after a listed entity verifies market rumours.
Listed entities are required to verify market rumours, upon material price movement. The unaffected price is to be considered by excluding the effect on the price of the equity shares of the listed entity due to the material price movement and confirmation of the rumour.
The framework for considering unaffected price will be applicable to top 100 listed entities from June 1 and to top 250 listed entities from December 1.
The unaffected price shall be applicable only if the listed entity has confirmed the rumour pertaining to the transaction within 24 hours from the trigger of material price movement. The unaffected price shall be applicable for a period of 60 days or 180 days, as applicable based on the stage of transaction.
SEBI has listed out the methodology for calculating the weighted average price and the adjusted volume weighted average price from the day of material price movement till the end of the next trading day after confirmation of the rumour.